”In South Africa the Constitution 1996 has entrenched the right to engage in collective bargaining in terms of section 23(5), amongst other labour rights. The Labour Relations Act 66 of 1995 (LRA) does not include an express duty to bargain much less impose a duty to bargain in good faith.” (Ndumo, 2005)
When referred to the Labour Relations Act of 1995, a failure to bargain constituted an unfair labour practice under South African labour law. Good faith bargaining on the other hand was considered important by limiting the spate of industrial unrest that dogged in the labour relations of South Africa and therefore the courts imposed a general duty to bargain. Trade unions relied on this duty to bargain so that they can obtain recognition and certain organisational rights such as leave for trade union activities, trade union access and many more. Collective bargaining is based on the recognition of the fact that employers enjoy greater social and economic power than individual workers, workers therefore need to act in concert to provide them collectively with sufficient power to bargain effectively with employers. There is no provision for duty to bargain in the Labour Relations act of 1995, however it codifies many of concessions sought by unions under the old law by extending a number of organisational rights to unions. These rights serve as a pretext to collective bargaining. Workplace forums effectively attempt to institutionalise bargaining at a level by making it mandatory that employers and employees consult of certain matters in the workplace where a forum has been established. (Venter & Levy, 2014)
The purpose of collective bargaining between employer’s organisations and organised labour is to conclude legal binding. Collective agreement is a written agreement that concerns the terms and conditions of employment or any matter of mutual interest concluded by one or more registered trade unions, and one or more employees, one or more registered employer’s organisation or one or more employers and one or more registered employer’s organisation. (Venter ; Levy, 2014)
The legal effect of collective bargaining: Collective agreements bind the actual parties and their members to the agreement. It is those agreements relating to employment conditions, or it can be the conduct of employers and employees in relation to one another. It binds the members of trade unions and employer’s organisations that are party to the agreement. (Venter & Levy, 2014)
Agreements may also bind employees who are not members of a trade union or trade unions party to the agreement as well as if trade unions are representative of the majority of employees in the workplace. (Venter & Levy, 2014)
Section 23 of the Labour relations act states that a ”collective agreement will vary any contract of employment where both the employee and the employer concerned are bound by the collective agreement” (Venter & Levy, 2014) A contract may not prescribe any terms or conditions that are worse than what is contained in the collective agreement.
Any dispute has to follow a dispute resolution process. Section 24 of the Labour Relations Act gives a procedure that needs to be followed. Any dispute about interpretation of a collective agreement should be resolved through arbitration if the attempt to resolve the dispute failed through conciliation. This dispute may also be revered to the CCMA only when the collective agreement fails to provide a procedure, the prescribed procedure is inoperative or the prescribed procedure is thwarted. When the dispute is referred to the CCMA the CCMA should attempt to resolve the dispute through conciliation and when there is a failing of satisfactory of the outcome it should go through arbitration. (Venter & Levy, 2014)
Bargaining levels are different levels where collective bargaining takes place to resolve a dispute between the employer and the trade union.
The first level of bargaining is the unit level, this is a decentralised approach to bargaining the unit level is also known as the individual level and there are no trade unions seen in this industry so whenever negotiation needs to take place it takes place at an individual level.
Plant level bargaining is the second level and this type of bargaining takes place between the employer and the trade union. If there is more than one union in other words multiple unions than the bargaining takes place between the employer and the multiple unions. The basis of bargaining are the parameters and that is set by a particular plant.
The third level of bargaining is the Industry level bargaining here bargaining generally takes place in a tripartite form which involves a union or unions the employer and the government officer or officers. The parameters for this bargaining can be different from industry to industry. Bargaining therefore doesn’t take place in the same form if the industries are different.
The Fourth bargaining level which is the Territorial/Geographical level, here employment provisions and pension schemes by territorial government changes depending on the area. Companies that are set up in varies geographical locations cannot use the parameters for bargaining.
The last bargaining level is the National level bargaining this is seen as a centralized bargaining unit it is a common bargaining level in the public sector where compensation and wages as well as employees benefits schemes are decided on a national level.
5.1) Yes management is obliged to disclose information to MAWU because any employer is obliged to disclose information that is relevant and necessary either to enable trade union representatives to perform their functions or allowing representative union to engage effectively collective bargaining.
5.2) any dispute that has to do with the disclosure of information should be referred to the CCMA and if the dispute is not resolved it must go through arbitration. A commissioner decides whether the information is relevant. If the information is found to be relevant the commissioner should than balance the harm that disclosure is likely to cause the employer or employee against the impact the information will have on the ability of trade union representative to perform their function or on the ability of trade unions to engage effectively in bargaining. (Venter ; Levy, 2014)
The question will remain how collective bargaining can take place in the South African industrial relations environment in the absence of a general duty to bargain. The consequence of this omission is that in principle an employer may refuse to engage or to bargain collectively with a trade union although that union has numerical strength or the extent to which the union represents employees in the employer’s organisation. The refusal to bargain with trade union by an employer constitutes legitimate grounds to a strike action that can take place. According to Section 64(2) of the LRA describes refusal to bargain as: there is a refusal to recognise a union as a collective bargaining agent. There is a refusal to agree to the establishment of a bargaining council and withdraw of recognition as a bargaining agent. Whenever the thee issue in dispute concerns a refusal to bargain an advisory reward must be made in terms of section 135(3)(c) before notice is given.
7.1) Bargaining in good faith was characterised by an open-mindedness on the part of the participants as well as a willingness to consider genuinely positions that are put and where possible to reach an agreement, opposed to a party that had a predetermined approach and was just simply going through motions that had no intension of shifting positions or considering a compromised settlement. Bargaining in good faith is a very important aspect in successful negotiations. Duty to bargain in good faith is merely a requirement for entering negotiations with the possibility of reaching an agreement. (Venter & Levy, 2014) The following can be used to ensure that negotiations retrieve a better outcome:
(Venter & Levy, 2014)
What is set by a negotiation should only be changed by a negotiation.
Representatives should not be bypassed, elected representatives should be ignored and talk directly to their constituents.
When statements are made it may not later be denied, this just defines that silence cannot be taken as an agreement.
If an agreement is once reached on an issue it may not be retracted only if it was clearly contingent.
Parties should engage through a chief negotiator on each side.
There must be normal conversations of polite interaction.
Conflict is not personalised, to make personal attacks or any comments are unprofessional.
Off the record interaction must remain just that because confidences are never breached
Talking must carry on, more conflict arises when parties do not speak.
Be willing to move because negotiation is about movement as well as to compromise.
7.2) Mekenzie as well as Walton had the same explanation on what bargaining is. Firstly we can look at distributive bargaining, in most popular management training programs distributive bargaining can be classified as a negative result because of the fact that it is a win-lose interaction. When two parties come together to negotiate the one party will always win in expense of the other and this type of negotiation is always scarcity in certain resources. Secondly we have Integrative bargaining this bargaining is the opposite of distributive bargaining because of the fact that it prefers a win-win situation for both parties and not just one. Some people would believe that this an unrealistic approach because of the fact that people would still like to benefit from the solution than to share with the opponent. (Venter & Levy, 2014)
Thirdly we have the intra-organisational bargaining, negotiating is a dynamic process that approaches aims to find common ground within the two parties before negotiation takes place. This bargaining type refers to the process of establishing consensus within each party. Throughout the process of negotiation both parties are continuously referring to their mandate givers. (Venter & Levy, 2014)
Lastly we have attitudinal structuring and building relationships, this process is particularly complex and involves the study where human behaviour is understood, labour negotiations are different from other negotiations where the parties never have to deal with each other again because here they most probably will. The relationship is enduring and the participating parties realise that once an agreement has been reached they still need to co-exist with each other. Even in the future they would most likely engage again and discuss a new agreements. It is not likely for parties to share a common vision they still need to build a good relationship for them to gain the possibility to enter an integrative bargaining and have a win-win outcome for both parties.
When we look at Fisher and Ury’s perspectives on bargaining it is seen as very different. Positional and interest bargaining, there approaches to bargaining begins with the requirement that you first have to gather in-depth knowledge and understanding of the opponents case. (Venter ; Levy, 2014)
Positional bargaining has the same approach as distributive bargaining where it is a win-lose of nature. Both parties are required to attack each other’s position and defend their own. This refers to a defend-attack spiral and this happens because each party has an interest they want to protect. They suggest that each party must identify their opponent’s interest and develop possible solutions that can include those interest. Their methodology move away from the traditional approach to negotiation and bargaining it moves towards a system that doesn’t affect the opponent’s belief system in a negative way. (Venter ; Levy, 2014)
7.3) The negotiation process consists out of different phases:
Pre-negotiation, the first thing that needs to be determined is whether there is reason to negotiate. Then it needs to be clear on what are the specifics that we want to negotiate about. Everything has to be in order before we can contact the person with whom you are going to negotiate. The establishment of some forms of negotiation agenda’s needs to be done before the process can begin. The correct people should be identified that will be involved in the negotiation as well as their level of responsibility and authority. As much information as possible should be obtained as well as the needs, motivation and goals. Deciding on a venue and appropriate time is also important to where the talks will take place.
Conceptualisation is the phase where you will develop the foundation of the agreement and it is to frame the issue. The basic concepts of the agreement needs to be put down. An attempt takes place to where you formulate which principles both parties can agree upon. In this phase you define each other’s goals and objectives through finding facts and establishing some measure of compatibility. Proposals are being advanced until some form of tentative agreement are reached. Terms of the partnership are re-framed until a level has been reached where both parties are satisfied.
Setting of details, this phase sees the completion of the agreement. In this phase you discuss the problems of implementing the partnership realistically for both parties to be viable and workable. The final stretch of this process is left to the legal experts that put the agreement into written form and then describes the contractual obligation to which both parties has to agree. Many negotiations collapsed because parties fail to devote necessary time and work to this process.
Follow- up when everything is signed it is still not the end. Any contract may need to be re-negotiated or the details need to be altered to counter a broad variety of changing circumstances. Embittered legal battles can be circumvented by keeping lines of communication open.
The process can also been seen as where preparation takes place, each party collects relevant information and data at the negotiating table.
Collection of data and all relevant information, it is vital for parties to have all the relevant information to dispose in good faith bargaining.
Establishing positions, establishment of own position as well as the position of the opposing parties.
Setting out objectives, objectives are seen as achieving the goals. When that is set parties should also have a fall-back position in mind.
Establishing the tone of the procedure, it is important that procedures and housekeeping rules for the proceedings are established.
Opening stages, this is where the party that wishes to change the status quo can begin. Opening statements are very important in regard.
Presenting the argument, good arguments are seen as concise, clear and follow a logical progression.
Dealing with conflict, conflict is unavoidable in negotiations it doesn’t matter what the intentions are, conflict in fact is both necessary and desirable.
The outcome, it is up to the negotiator whether they want to concede or compromise.
Analysing the impact of section 18 of the Labour Relation Act 66 of 1995 states that on the constitutionally entrenched right every person has the freedom of association. The right of every trade union to engage in collective bargaining as well as the right for every trade union to organise. There is further different organisational rights to registered, representative trade unions extended by the LRA. These rights are extended to registered trade unions that have established a threshold of representatively that includes access to an employer’s premises for recruiting to take place as well as other union purposes. The deduction of union dues which can take place because according to section 13 an employer may be authorised in writing the deduction of union dues from the salary of a member. The appointment of representatives is stated in section 14 that where an employer employs ten or more members of a trade union that represents the majority of employees and the members may then select a workplace representative among themselves. When we look at leave for trade union activities employees are allowed to take reasonable time off from work in addition and for the purpose of fulfilling trade union obligations but the employer as well as the representative trade union will determine jointly what is reasonable time and the conditions that are attached to it. Access to information and the disclosure of information is where an employer is obliged to disclose information which is relevant and necessary that enables trade union representatives to perform their functions and also allowing a representative to engage in collective bargaining. (Venter ; Levy, 2014)
Everyone is equal before the law and has the right to have equal protection and receive the benefit of the law. When we look at equality before the law for all trade union it is not often seen in practice. This is a case that despite minority trade unions fulfilling an important role in the current labour system. The right to establish thresholds of representatives are stated in Section 18(1) of the LRA as an employer and registered trade union whose members are a majority of the employees that are employed by that employer or the parties to a bargaining council may conclude a collective agreement. The application of section 18 further indicated solidarity’s experience in the mining industry, after interviews was conducted it revealed that the impact of section 18 showed that the provisions of section 18 are used by the majority of trade unions to set inordinately high thresholds for representivity which effectively ensured that Solidarity and other minority unions lose recognition where the higher threshold cannot be reached. Solidarity are organised into a big bargaining unit and the effect then is that minority unions find it difficult to reach required threshold in the new bargaining structure. There are a number of examples of the manner in which section 18 finds application in mining industry of South Africa.
When we look at bargaining councils it is seen that it exists of voluntary bodies which is established by the terms of Section 27 of the Labour Relations Act that consist of one or more registered trade unions and one or more registered organisations. Employers may also be part of a bargaining council where they will be represented by an employer organisation. This is done by a formal registration and adopting a constitution. The formal registration of councils is governed by Section 29 of the Labour Relations Act. (Venter & Levy, 2014).
When the applications are received a publication is released for the public to raise any complaints or objections that may have occurred during these applications. These applications still need to be in line with the requirements of sufficient representation. After the applications have been released the applicants have fourteen to thirty days to respond to any objectives. Furthermore the applications, responses as well as the objectives need to be considered by the National Economic Development and Labour Council then they will set the boundaries or limits of a sector. If they fail to agree to the boundaries or limits that are set it will be referred to the Minister of Labour to again set the boundaries or limits to a sector.
For the application to be registered at the council it has to be approved by the administrator. If the application is not according to the standards the applicant will receive thirty days to correct the application and to re-submit. Collective agreement can be reached which binds the parties of the bargaining council as well as their members. (Venter & Levy, 2014)
The bargaining council system in South Africa provides the central pillar of collective bargaining. In South Africa collective bargaining is one of the main goals in the industrial relations system. South Africa regulated flexibility as one of the goals being achieved through collective bargaining. Only a few research has been done about collective bargaining although the fact is that it’s a very important industrial relations implication. Information regarding if development is taking place in organisations are just a few. With the lack of research it contributes to the outcomes of bargaining with a negative impact and this leads to not much information on wage rates that are bargained at organisations. Therefore more research has to be done to ensure collective bargaining is successful in South Africa.
It is not clear whether public sector workers are in a weaker position than private sector workers to exert wage pressure. Public sector unions are legal but are often legally barred from striking. With this being said it may suggest that the average mark-up in the public sector may be smaller than the mark-up in the private sector. Public goods are produced in an environment with very little competition and the public sector are not motivated by profit concern. With the lack of competitive pressure and a soft budget it makes it easier to pass on the costs of high wages. The public sector unions may be able to influence employer’s behaviour through political process. ( Aidt & Tzannatos, 2002)
In a lot of developing countries unionization is concentrated in the public sector and these unions engage in certain legal constraints. In the private sector working conditions and wages of unionized workers are determined by a union-negotiated contract and non-union workers are excluded from the benefits of the union contract. When we look at the public sector the wage- comparability criterion is often used and it is not uncommon for the unions nor the non-union workers to receive the same working conditions and wages. With this being said it makes it more difficult to classify workers on how their wage is being determined and the work force mix differs between the private and public sectors. The work force in the public sector generally consists of a disproportionately large share of white collar workers. The mark up for white collar workers tends to be smaller than of the blue collar workers and failing to take the work for the work force mix into account can have an influence on the mark-up in the public sector. Furthermore third workers in these sectors receive different amounts of fringe benefits. It is found that within the public sector the wage mark-up is the low for federal employees and high for employees of local government in the United States.
Collective bargaining can insert a wedge between the productivity of workers and wages. In South Africa the wage mark-up for workers with different skills varies between the different ethnic groups. When we look at the average wage for unskilled non-white workers it is a percentage of 19 while thee wage for semiskilled non-white workers are quit smaller and the wage mark-up for skilled non-white workers is about zero. Semiskilled and skilled white workers receive a wage mark-up of 13 percent. Industry unions tend to reduce the difference between workers with different skills more than company unions do.
Bargaining councils operates in the terms of the Labour Relations Act of 1995. These bargaining council are established when employer and employees from a particular industry come together to engage in collective bargaining.
Once a bargaining council is registered it has a range of powers as well as obligations. One of these powers are relating to the establishment of social benefit funds. Because of bargaining councils employees are able to enjoy certain funds that provide them with benefits they need. Among the advantages of registration there is a possibility that agreements are extended to non-parties for all employers and employees to be covered. According to Godfrey (2006), approximately 9.5 million employees covered by the LRA and Basic Conditions of the employment act about 25% are covered by bargaining council agreements. This council’s coverage increases to just under a third of all the employees if the calculation is done and restricted to employees in occupational categories 4-9 such as clerks, service and shop workers, fishery workers etc. Certain private sector councils (total of 27) reported that they had at least one fund where employees are covered with. A council are able to cover a large number of overall employees. Employees enjoy funding such as pension funds, where benefits are provided for them in the time of retirement it helps employees to take care of themselves the day they retire or can no longer work because of health problems caused by their age. A provident fund was also established for the uncovered workers. Employees also receive the benefit of provident funds, and this is where funds provide for retirement benefits. It is funds that help employees to receive benefits out of their retirement one day. Medical and sick benefit funds, the medical aids generally had skilled, higher income workers as members and also provided more comprehensive curative benefits. This medical aid funds is a form of insurance for employees. When we look at sick pay funds it is funds that are paid in long and short term illness. Most of the funds did not pay for the first few days that a worker was sick and required a doctor’s certificate from the employee. That was only in the beginning of the fund. A lot of employees benefitted from this fund because this fund was initially for illness of three days or longer and in some cases the doctor felt pressure to book the employee off for longer than what is necessary and employees enjoyed that because they didn’t understand the cost related to it. Disability cover is another benefit employees benefits from because it is intended to provide relief when an employee loses earnings as a result of permanent disability and some cases where an employee can no longer work. Employees also receive survivor benefits and this provides assistance to family members if the employee dies. Because in many cases that certain employee was the care taker of a family. This fund is also more commonly known or referred as death benefits. Death benefits are provided for surviving dependants through the compensation act in respect of an employee who dies in a work related injury or illness. Furthermore leave and holiday pay, is funding that is paid for extra days. By requirements an employee has the right to receive a certain amount of paid leave a year or payment of a bonus when an employee goes on annual leave. There are also UIF, Unemployment Insurance Fund that provides cover across all industries to employee who become unemployed. This also counts for maternity and illness.
I believe if we look further into this topic it is known that employees also receive benefits through trade union because trade unions represent them, protect them and speak for them. The benefit to be registered to a trade union is simple, employers cannot do whatever they want to nor treat an employee unfair or unprofessionally because an employee as rights.
The unemployment rate is extremely high in South Africa. Possible reasons why unemployment adults do not create informal work for themselves is because South Africa succeeds in extending labour regulations. Trade unions and unemployment are hardly mentioned in most theories. A theoretical framework needs to be used to understand the importance of unemployment. The most common fact is that unemployment hurts the economy because people who are unemployed have less money to spend. Employees who become unemployed have the right to claim UIF but they have to apply and they will be paid at the labour centre. South Africa go through great lengths to measure any economic activity to identify whether workers who engage in unpaid households work households plots. High unemployment may suggest minimal small-scale employment in a high unemployment context. When unemployment is high it has an impact on society. Unemployment result in family and individual consequences because job loss is associated with elevated rates of physical health and mental problems. There is a psychological well-being of spouses and children. There is a change in family relationships. Compared to employees who have stable jobs those who have lost their jobs have poorer mental health, low satisfaction in life, less family satisfaction. (McKee-Ryan, Song, Wanberg, ; Kinicki, 2005) Unemployment is also associated with anxiety, depression, poor self –esteem and many more. ”Unemployed workers were twice as likely as their employed counterparts to experience psychological problems” (Paul ; Moser, 2009)
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